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Govt to Begin Third Round of Privatisation of 6-10 Airports in April, Says Official

For representation

For representation

In her budget speech on the floor of the Parliament, Finance Minister Nirmala Sitharaman, too, had said that this year the government will privatize airports operated by AAI from tier II and III cities.

The government is all set to start the third round of the airport privatisation in April this year, Pradeep Singh Kharola, the civil aviation secretary, said on Thursday, adding it could see six-ten airports taken.

In this round, the government will adopt a fresh approach, that of clubbing a non-profit-making airport with a profit-making one and offering it in the form of a package. “The Airport Authority of India (AAI) is examining the feasibility of giving a non-profitable airport and a profit-making airport as a package. We could see six to 10 airports being taken up," Kharola said.

In her budget speech on the floor of the Parliament, Finance Minister Nirmala Sithraman, too, had said that this year the government will privatize airports operated by AAI from tier II and III cities.

According to a report in Mint, the AAI is raising Rs 2,100 crore from banks for its capital expenditure requirements in 2021-22.

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In the first round of divestment, which started in 2018, the airports of Lucknow, Ahmedabad, Thiruvananthapuram, Guwahati, Jaipur and Mangalore were awarded to the Adani group.

Besides this, Kharola said the government was constantly monitoring the air traffic levels and would "ensure there was enough supply in the market to match the demand". Currently, he said, of the allowed 80% limit in domestic flights, there was 60-65% utilisation.

Following the Covornavirus pandemic, the government had suspended domestic and international flights. On May 25, after two months of suspension, domestic flights resumed with capped fares.

Kharola said the decision on fare cap will be taking into account the demand in the market, adding it was supposed to be "temporary". Apart from this, the government is also keen on opening up international passenger flights, currently operating under air-travel bubble arrangements, Mint reported.

Separately, the civil aviation secretary added the government will float the preliminary information memorandum for Air India Air Transport Services Ltd (AIATSL) to commence its divestment process once again, reports CNBCTV18.

AIATSL, the wholly-owned subsidiary of Air India, is involved in the handling of cargo, passenger, and ramp for aircraft.